Nigeria's Nigerian Education Loan Fund (NELFUND) has disbursed more than ₦303 billion to about 850,000 students since its launch in 2024, but the scheme exposes a deeper paradox: an oil-rich nation asking its youth to borrow for the education the country itself needs them to acquire. This tension was highlighted by Mrs. Oluremi Tinubu's suggestion that beneficiaries could "start small" by selling akara and kuli kuli to supplement their upkeep, a remark that has drawn widespread criticism.
The NELFUND Scheme and Its Context
NELFUND was established under the Student Loans (Access to Higher Education) Act, 2024, to address Nigeria's chronic higher-education financing gap. The scheme operates against a backdrop of inadequate public funding, deteriorating infrastructure, and rising costs, while millions of families face declining purchasing power. By August 2026, institutional fees had been paid to hundreds of tertiary institutions, and eligible students receive a monthly upkeep allowance of ₦20,000.
The scheme's existence raises a fundamental policy question: should a student loan scheme be the principal answer to an affordability crisis that is, in part, the product of inadequate public investment in education? This question becomes more compelling when Nigeria's resource wealth and educational outcomes are compared with those of other resource-rich countries.
Oil Wealth Versus Educational Outcomes
Nigeria's crude oil story began at Oloibiri in present-day Bayelsa State in 1958, when it was discovered in commercial quantity. Agriculture, once the dominant export and livelihood source, gradually gave way to petroleum. The country is endowed with natural gas, coal, iron ore, tin, limestone, gold, bitumen, lead, zinc, gypsum, and other minerals. Yet Nigeria has struggled to convert these natural advantages into sustained human development.
The World Bank's 2026 human-capital assessment puts Nigeria's education-pillar score at 64, significantly below the median of 88 for lower-middle-income countries. Tertiary completion is estimated at only 11.3 percent. The World Bank further estimates that deficits in health, education, and workforce skills represent a loss equivalent to 111 percent of future labour earnings.
The ₦20,000 Upkeep Allowance Question
The approved monthly upkeep allowance remains ₦20,000, a figure NELFUND reaffirmed in March 2026. This amount must cover food, accommodation, transportation, data, textbooks, printing, and other academic requirements. For students living away from home, accommodation can consume a substantial part of the family's income.
The allowance's purchasing power steadily collapses without periodic review against inflation and the real cost of student life. This is where Senator Tinubu's akara-and-kuli-kuli suggestion becomes relevant: when entrepreneurial activity becomes a necessity for survival rather than an opportunity for enterprise, the policy question changes. A student should not have to become a street entrepreneur simply to remain academically functional.
Lessons From Resource-Rich Countries
Norway's Lånekassen system combines loans and grants, with a substantial portion of eligible student support convertible into a grant when students meet specified conditions, including completing their education. Full-time student loans are interest-free while studying. The Norwegian state constructs a wider support system around students, recognising that an educated population benefits society.
Saudi Arabia has built an extensive public university system alongside government scholarship programmes supporting citizens studying within and outside the country. The United Arab Emirates has placed higher education at the centre of its ambition to build a competitive, knowledge-based economy. These countries recognise that the most valuable investment is the development of people capable of sustaining the economy after the resource boom.
Toward a National Human-Capital Strategy
Kalu Okoronkwo, a communications strategist and leadership advocate, argues that NELFUND must be seen as part of a broader higher-education financing architecture rather than as the architecture itself. He proposes several reforms: the upkeep allowance should be periodically reviewed against inflation; the loan system should incorporate stronger income-sensitive repayment mechanisms; students from the poorest households should receive a stronger grant component; students in strategically important disciplines should have access to enhanced scholarships or partial loan conversion; public universities should receive predictable and adequate funding tied to measurable improvements; research and innovation funding should be substantially increased; and mechanisms should be explored to systematically convert a portion of resource revenues into long-term human-capital investment.
The ultimate test of NELFUND should not be the number of loans disbursed or the billions of naira transferred. It should be whether, 10 or 20 years from now, Nigeria can look back and say its oil wealth was finally converted into something more enduring than revenue: a generation of educated, skilled, innovative, and economically empowered citizens. Until then, the paradox remains—Nigeria has spent decades extracting wealth from beneath the ground while failing to invest adequately in the wealth above it, the human being.
